Traditional financial institutions have reached the point in which they are highly regulated. This has come to be not only after scandals that have occurred in the past, but also just due to the fact of how massive the financial entities have become. Fintech has becoming more and more prevalent, and in many areas do the same tasks that traditional financial institutions do to source some of their revenue. However, at this point there are minimal restrictions and regulations on fintech institutions. I think that it is preferable to create policies first to help prevent any unfavorable outcomes that may occur later in the future. An executive arm of Europe launched a task force recently to study how financial technology could transform financial services to eventually regulate virtual currencies, among other things. Although there are benefits to financial technology, there are challenges that it brings and the new task force will present policy suggestions and recommendations in the first half of this year. The task force is made up of a number of individuals from varying backgrounds such as financial and digital services, digital innovation and security, and other backgrounds. Because fintech firms are having access to confidential data, the task force is making sure that their policy will support the opportunities of fintech firms, while making sure to pay attention to any potential risks.
Link to article: https://www.law360.com/articles/862019/new-eu-fintech-task-force-will-outline-policies-by-2017